Cheap coffee - great news for customers, or a bad deal for farmers?

A new entrant is trying to shake up Wellington's crowded coffee market by selling all its regular size coffees for just $2.50.

But some industry figures are saying we should actually be paying more for our daily shots, to help hard-pressed growers to farm more sustainably.

Wellington's first Coffix cafe, on the corner of Ballance and Featherston streets, has been open for two weeks, and demand has been so high there are already plans to open a second one.

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Coffix, the new cafe on the Wellington block, is selling all its coffees for $2.50. (File photo)

Long blacks at $2.50 can be found in various spots in Wellington, but Coffix is offering all its regular coffees at that price. Extra shots, soy milk, and syrup shots are free, and it's $3.50 for a large.

Coffix says it sources all its beans from co-operatives, and is fully fair trade.

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Some industry figures say customers should be paying higher prices for their coffee, to help growers to farm more sustainably.

However, Richard Corney, whose Flight Coffee Hangar in Willis St sells takeaway flat whites for $4.50, said the general price of coffee was already too cheap, and an additional 50c would go a long way to ensuring producers were paid a fair price for the raw beans.

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Franchisee Gil Salz at Coffix's first Wellington shop, in Ballance St. "We were busy from the first moment," he said.

That view was backed by Trade Aid Importers food manager Justin Purser, who said: "Much of the coffee we drink in New Zealand is grown by farmers who have only a hectare or two of land, and who are under enormous financial pressure.

"Their production costs are rising, the prices they receive for their coffee are generally in decline, and their production volumes are falling as a result of aging tree stock and climate-related problems.

"A key focus of fair trade is to support as many of these farmers as we can with higher prices, along with other support they can access through their co-operatives, so they can improve their lives, and produce coffee more sustainably."

Coffix co-founder Nathan Tal said the secret of its prices was overheads, and only doing takeaways.

"There's no other ingredient. The minute you take out the kitchen, the chef, large footprint, all those extras, you are basically paying just for the coffee."

He did not expect a price war, saying: "The way I look at it, cafes that are doing a good job with a good menu, and base their business model mainly on food, we don't affect them.

"If you go to a meeting, you want to sit in a cafe, you want to be served."

Wellington coffee heavyweight Mojo said it was not concerned about the new cafe on the block.

"McDonald's sell their coffee for around that price too, and they've been around forever."